Introduction
Over the past two decades, Mexico has suffered a degenerating political, social and economic situation making it one of the most volatile nations in the globe. Experts point out that began the problem with the stolen election of 1988 by former President Carlos Salinas. Ever since that incident, the country spiraled into low living standards, total judicial breakdown and the complete lack of security. The country is run by drug cartels and illegal gangs and it seems the government cannot do anything about it.
Economic Inequality
Economically, the country seems to be emerging from a ‘rock bottom’ situation. After the signing of the North American Free-Trade Agreement (NAFTA) by president Salinas in 1993, nearly 10 million farmers were rendered bankrupt (The Economist). Famers in north Mexico lost most of their livelihoods and as a consequence, poverty took hold of the situation.
Poverty in the north of the country created a huge leadership vacuum. It was at this time that drug lords took hold of the northern states in Mexico and have since spread their influence to the central government. Such a situation in which drug cartels basically run the country has created a few dollar billionaires and millions of poor citizens. The gap between the rich and the poor seems to be deepening each year.
The effects of such inequality in the society are very vivid. Poverty has pushed millions of Mexicans to take the dangerous decision of trying to immigrate to the United States. In these journeys several people lose their lives or face long term jails term in the United States.
In an effort by the few rich individuals to retain the influences, violence has been the order of the day in Mexico. The country has suffered one of the longest civil wars caused by drug cartels that seem to blackmail those in leadership and the poor citizens. The President, Mr., Calderon, has often reiterated his governments’ commitment to fighting drug lords. However, every year, the death toll from drug related violence has hit new records. Chihuahua State bordering Texas is one of the most famous hot spots in this security decay. In the year 2010, its city recorded nearly 3000 deaths from drug related violence making it as dangerous as places such as Mogadishu and Baghdad. Such lack of a stable secure environment is doing great damage to Mexico’s economy. If such inequality persists the social fabric of Mexico will to decay.
Latin America and Global Economy
Just like the entire Latin America, Mexico’s worsened during the financial crisis suffered by their biggest trading partner, the United States (The Economist). Recession in United State’s economy reduced exports from Mexico by about 25%. This decline in exports pushed the economy of the country into deep recession. The situation is made worse by currency wars currently taking root in world trade today. The peso is a rapidly appreciating against the dollar. This puts Mexican products at a poor competitive state against other imports from countries such as Canada and China.
Latin America has since exported most of its products to the US as it is closer and the market in quite big. The region also seems to rely on drug trade and indigenous communities make their living from growing coca plants. Therefore governments are trying to move out illegal business into mainstream trade.
For example, a major economic project called the “Interpuerto” is underway in north Mexico. The project is meant to be a customs clearance center for goods going into the US market. The new clearing center makes use of an interjection of two rail lines and motorways. This will avert the time wasted in long queues at the border. Such a project is vital for the recovery of the country’s economy as it heavily relies on export to its huge northern neighbor. However, exports to the north may not be an appropriate solution as China’s imports into the United States has swamped all kinds of markets of finished goods.
Works Cited
The Economist. A Fatal Crash. 11 Nov 2011. 28 Nov 2011
The Economist. Bringing NAFTA back home. 28 Oct 2010. 28 Nov 2011
The Economist. left In the Lurch. 19 Nov 2011. 28 Nov 2011
